What is Business Management?

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Business Management

Business Performance Management Is What It Really Means

Business management focus is on business results. Unless business managers maintain this focus throughout, management can become a routine bureaucratic process.

The fundamental business results are:

  • Delivering value to consumers
  • Generating a profit for business owners

These results are achieved through strategies and plans, and their implementation.

Business Management Strategy

Business strategies seek to define the broad approach for achieving desired business results effectively and efficiently.

Strategy development starts with a look at the existing situation of the business, and a vision of the situation it wants to be at the end of, say five years from now. The exercise proceeds to identify a feasible approach to achieve that vision.

For example, a company might decide that it will go along the acquisitions and mergers route to double its profit every year, and that the acquisitions shall be financed through profits and borrowings.

It will then be task of the CEO and functional managers to develop specific plans and programs to execute that strategy.

Business Functions and Functional Management

The following outline makes clear the different functionalities and expertise needed to develop and execute plans.

  • Financial Management ensures that necessary funds will be available to execute planned programs and projects.
  • Technology Management sees to it that facilities are available to carry out operations in a cost and quality effective manner.
  • Marketing Management organizes marketing efforts to achieve planned sales volumes and profits.
  • Operations Management executes the business’ operations efficiently to make sales and profit targets achievable.
  • Human Resource Management recruits, trains and motivates the employees to ensure that targets in all functional areas are achieved.
  • Management Information Systems utilize information technology to provide timely information to managers and help them achieve targets.
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Coordination among different functions is achieved through integrated business plans that set functional targets consistent with each other.

Control is achieved through management reports that compare actual performance against targets, so that concerned managers can take remedial actions if necessary.

The Process of Business Management

Managers typically adopt a systematic process to discharge their roles.

  • Planning to set time-bound targets and find ways to achieve them
  • Organizing to assemble required resources to execute the plans
  • Staffing to identify the tasks, skills and roles involved and arrange (and train) needed people
  • Motivating people to perform to expectations so that business goals are achieved
  • Leading by determining what needs to be done in different situations and getting people to do it
  • Controlling performance by comparing it against what was expected and taking remedial action if it falls short of expectations

Business Management Success

A business is considered successful if it is able to satisfy all the stakeholders.

  • Owners who expect reasonable returns on their investment
  • Customers who expect good value for their money
  • Employees who expect rewarding careers
  • Public who expects the business act responsibly

Business management is a multi-dimensional endeavor that seeks to provide value to consumers, good returns to investors and rewarding employment opportunities to career seekers.

It seeks to deliver on these promises through planning, organizing, motivating and controlling.

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